Northern Technologies International Corporation, a
Delaware corporation (NTIC or the Company), proposes, subject
to the terms and conditions herein, to issue and sell an aggregate of up to
$3,552,000 in shares (the Shares) of its common stock, $0.02 par value
per share (the Common Stock) under the form of subscription agreement
attached hereto as Exhibit A (the Subscription Agreement),
directly to various institutional investors (collectively, the Investors).

The Company hereby confirms its agreement with Next
Generation Equity Research, LLC (the Placement Agent) as follows:

(a)On the basis of
the representations, warranties and agreements of the Company herein contained,
and subject to all the terms and conditions of this Agreement between the
Company and the Placement Agent, the Placement Agent shall be the Companys
exclusive placement agent, on a reasonable best efforts basis, in connection
with the issuance and sale by the Company of the Shares in the proposed
takedown from a shelf registration statement on Form S-3 (Registration
Statement No. 333-153891) (the Registration Statement), with the
terms of such takedown to be subject to market conditions and negotiations
between the Company, the Placement Agent and the prospective Investors (such
takedown shall be referred to herein as the Offering). As compensation for services rendered, and
provided that any of the Shares are sold to Investors in the Offering, on the
Closing Date (as defined below) of the Offering, the Company shall pay to the
Placement Agent an amount equal to (a) six and one-half percent (6½%) of
the gross proceeds received by the Company from the sale of the Shares in the
Offering; and (b) all the Placement Agents reasonable out-of-pocket,
legal and other expenses (with supporting invoices and receipts) up to a
maximum of $65,000.

This
Agreement shall not give rise to any commitment by the Placement Agent to
purchase any of the Shares, or an obligation for the Company to issue any
Shares or complete the Offering. The
Placement Agent shall have no authority to bind the Company. The Placement Agent shall act on a reasonable
best efforts basis to solicit offers to purchase the Shares and to procure
performance by the Investors in the purchase of the Shares; provided, however that the Placement Agent does not
guarantee that it will be able to raise new capital in the prospective
Offering. The Placement Agent shall
communicate to the Company, orally or in writing, each reasonable offer to
purchase Shares received by it as agent of the Company. The Company shall have the sole right to
accept offers to purchase the Shares and may reject any such offer, in whole or
in part. The Company acknowledges that any advice given by the Placement Agent
to the Company is solely for the benefit and use of the Board of Directors of
the Company and may not be used, reproduced, disseminated, quoted or referred
to, without the Placement Agents prior written consent. The Placement Agent may, with the prior
written consent of the Company, retain other brokers or dealers to act as sub
agents on its behalf in connection with any Offering.

(b)The term of the Placement Agents
exclusive engagement will be six months; however, the Company may terminate the
engagement at any time and for any reason upon 5 days written notice to the
Placement Agent. Upon termination, the
Placement Agent will be entitled to collect all fees earned pursuant to the
terms hereof and, to the extent provided herein, to be reimbursed for all
expenses incurred through the date of termination. Nothing in this Agreement shall be construed to limit
the ability of the Placement Agent or its affiliates to pursue, investigate,
analyze, invest in, or engage in investment banking, financial advisory or any
other business relationship with entities or persons other than the Company.

Section 2.Representations,
Warranties and Agreements of the Company.

Except as set forth in the Registration Statement,
the Base Prospectus or the Prospectus Supplement, the Company hereby
represents, warrants and covenants to the Placement Agent as of the date
hereof, and as of the Closing Date of the Offering, as follows:

(a)Securities
Law Filings. The Company
has filed with the Securities and Exchange Commission (the Commission)
the Registration Statement (as defined below), which became effective on January 16,
2009, for the registration under the Securities Act of 1933, as amended (the Act),
of the Shares. On the date of the filing
of the Registration Statement and the date on which the Registration Statement
became effective, the Company met the requirements for use of Form S-3
under the Act. Such registration
statement meets the requirements set forth in Rule 415(a)(1)(x) under
the Act and complies in all other material respects with said Rule. The Company will file with the Commission
pursuant to Rule 424(b) under the Act and the rules and
regulations thereunder a supplement to the form of prospectus included in such
registration statement relating to a placement of the Shares and the plan of
distribution thereof and the Company has advised the Placement Agent of all
further material information (financial and other) with respect to the Company
to be set forth therein. Such
registration statement, including the exhibits thereto, as amended at the date
of this Agreement, is hereinafter called the Registration Statement;
such prospectus, in the form in which it appears in the Registration Statement,
is hereinafter called the Base Prospectus; and the supplemented form
of prospectus, in the form in which it will be filed with the Commission
pursuant to Rule 424(b), is hereinafter called a Prospectus Supplement. Any reference herein to the Registration
Statement, the Base Prospectus or the Prospectus Supplement shall be deemed to
refer to and include the documents incorporated by reference therein (the Incorporated
Documents) pursuant to Item 12 of Form S-3 which were filed under the
Securities Exchange Act of 1934, as amended (the Exchange Act), on or
before the date of this Agreement, or the issue date of the Base Prospectus or
Prospectus Supplement, as the case may be; and any reference herein to the
terms amend, amendment or supplement with respect to the Registration
Statement, the Base Prospectus, or the Prospectus Supplement shall be deemed to
refer to and include the filing of any document under the Exchange Act after
the date of this Agreement and prior to the time of the Closing (as defined
below), or the issue date of the Base Prospectus or the Prospectus Supplement,
as the case may be, deemed to be incorporated therein by reference. All references in this Agreement to financial
statements and schedules and other information which is contained, included
or stated in the Registration Statement or the Prospectus Supplement (and all
other references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is or is deemed
to be incorporated by reference in the Registration Statement or the Prospectus
Supplement, as the case may be.

(b)No Stop
Order. No stop order suspending the
effectiveness of the Registration Statement or the use of the Base Prospectus
or the Prospectus Supplement has been issued, and no proceeding for any such
purpose is pending or has been initiated or, to the Companys knowledge, is
threatened by the Commission.

2

(c)Compliance
with Applicable Regulations. The Registration Statement (and any further
documents to be filed with the Commission in connection with the Offering)
contains or will contain, as applicable, all exhibits and schedules as required
by the Act. Each of the Registration
Statement and any post-effective amendment thereto, at the time it became or becomes
effective, complied in all material respects with the Act and the Exchange Act
and the applicable rules and regulations of the Commission thereunder and
did not and, as amended or supplemented, if applicable, will not, contain any
untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading. Each of the Base Prospectus
and the Prospectus Supplement, as of its respective date, complied in all
material respects with the Act and the Exchange Act and the applicable rules and
regulations of the Commission thereunder.
Each of the Base Prospectus and the Prospectus Supplement, as amended or
supplemented, did not and will not contain as of the date thereof any untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in light of the circumstances under which
they were made, not misleading. The
Incorporated Documents, when they were filed with the Commission conformed in
all material respects to the requirements of the Exchange Act and the
applicable rules and regulations of the Commission thereunder, and none of
such documents, when they were filed with the Commission, when read together
with the other information in the Registration Statement, contained any untrue
statement of a material fact or omitted to state a material fact necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading; and any further documents so filed and incorporated
by reference in the Base Prospectus or Prospectus Supplement prior to the
Closing, when such documents are filed with the Commission, will conform in all
material respects to the requirements of the Exchange Act and the applicable rules and
regulations of the Commission thereunder, as applicable, and when read together
with the other information in the Registration Statement, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in light of the circumstances under which they
were made, not misleading. Notwithstanding the foregoing, the Company makes no representations or
warranties as to the information contained in or omitted from the Prospectus
Supplement or any amendment thereof or supplement thereto in reliance upon and
in conformity with information furnished in writing to the Company by or on
behalf of the Placement Agent specifically for use in the Registration
Statement or the Prospectus Supplement. No post-effective amendment to the
Registration Statement reflecting any facts or events arising after the
effective date thereof which represent, individually or in the aggregate, a
fundamental change in the information set forth therein is required to be filed
with the Commission.

(d)No Offers. Prior to the execution of this Agreement, the Company
has not, directly or indirectly, offered or sold any Shares by means of any prospectus
(within the meaning of the Act) or used any prospectus (within the meaning of
the Act) in connection with the offer or sale of the Shares, in each case other
than the Base Prospectus and the Prospectus Supplement (if the parties utilize
the Base Prospectus and the Prospectus Supplement at or prior to the time of
receipt and acceptance by the Company of an executed Subscription Agreement);
the Company has not, directly or indirectly, prepared, used or referred to any
free writing prospectus (as defined in Rule 405 under the Act) except in
compliance with Rules 164 and 433 under the Act; assuming that such free
writing prospectus is so sent or given after the Registration Statement was
filed with the Commission (and after such free writing prospectus was, if
required pursuant to Rule 433(d) under the Act, filed with the
Commission), and the Registration Statement includes a prospectus that, other
than by reason of Rule 433 or Rule 431 under the Act, satisfies the
requirements of Section 10 of the Act; the parties hereto agree and
understand that the content of any and all road shows (as defined in Rule 433
under the Act) related to the offering of the Shares contemplated hereby is
solely the property of the Company.

(e)Reports
and Documents, etc. There are
no documents required to be filed with the Commission in connection with the
transaction contemplated hereby that (x) have not been filed as required
pursuant to the Act or (y) will not be filed within the requisite time
period. There are no material

3

contracts or other documents required to be
described in the Prospectus Supplement, or to be filed as exhibits or schedules
to the Registration Statement, which have not been described or filed as
required.

(f)Offering
Materials Furnished to the Placement Agent. The Company has delivered, or upon request
will as promptly as practicable deliver, to the Placement Agent complete
conformed copies of the Registration Statement and of each consent and
certificate of experts, as applicable, filed as a part thereof, and conformed
copies of the Registration Statement (without exhibits) and the Base Prospectus
and the Prospectus Supplement, as amended or supplemented, in such quantities
and at such places as the Placement Agent reasonably requests.

(g)Distribution
of Offering Material. The Company
has not distributed and will not distribute, prior to the Closing Date, any
offering material in connection with the offering and sale of the Shares other
than the Base Prospectus and the Prospectus Supplement or the Registration
Statement and copies of the documents incorporated by reference therein. For the avoidance of doubt, any other
material prepared and distributed solely by the Placement Agent is not deemed
to be distributed by the Company for purposes of this paragraph (g).

(h)The
Placement Agency Agreement. This Agreement has been duly authorized,
executed and delivered by, and is a valid and binding agreement of, the
Company, enforceable against the Company in accordance with its terms, except
as rights to indemnification and contribution hereunder may be limited by
applicable law and except as the enforcement hereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to or affecting the rights and remedies of creditors or by general
equitable principles.

(i)Authorization
of the Shares. The Shares
have been duly authorized for issuance and sale, and the Shares, when issued
and delivered by the Company to the Investors against payment therefor pursuant
to this Agreement and the terms of the Subscription Agreements, will be validly
issued, fully paid and nonassessable.

(j)No
Material Adverse Change.
Subsequent to the respective dates as of which information is given in
the Base Prospectus and in any Prospectus Supplement: (i) there has been no material adverse
change or effect, or any development that could reasonably be expected to
result in a material adverse change or effect, in the condition, financial or
otherwise, or in the business, operations or prospects of the Company and the
Subsidiaries (as defined below) taken as a whole (any such change or effect,
where the context so requires, is called a Material Adverse Change or
a Material Adverse Effect); (ii) the Company and the Subsidiaries
have not incurred any material liability or obligation, indirect, direct or
contingent, not in the ordinary course of business nor entered into any
material transaction or agreement not in the ordinary course of business; and (iii) there
has been no dividend or distribution of any kind declared, paid or made by the
Company on any class of capital stock or repurchase or redemption by the
Company of any class of capital stock.

(k)No Default. Neither the Company nor the Subsidiaries is in breach
or violation of or in default under (nor has any event occurred which, with
notice, lapse of time or both, would result in any breach or violation of,
constitute a default under or give the holder of any indebtedness (or a person
acting on such holders behalf) the right to require the repurchase, redemption
or repayment of all or a part of such indebtedness under) (A) its charter
or bylaws or other organizational or charter documents, or (B) any
indenture, mortgage, deed of trust, bank loan or credit agreement or other
evidence of indebtedness, or any license, lease, contract or other agreement or
instrument to which it is a party or by which it or any of its properties may
be bound or affected, or (C) any federal, state, local or foreign law,
regulation or rule, or (D) any rule or regulation of any
self-regulatory organization or other non-governmental regulatory authority
(including, without limitation, the rules and regulations of NASDAQ), or (E) any

4

decree, judgment or order applicable to it or any of its properties,
except, with respect to clauses (B), (C), (D) or (E), for such breaches,
violations, defaults and events as would not, individually or in the aggregate,
have a Material Adverse Effect;

(l)No Conflict. The execution, delivery and performance of this
Agreement by the Company, the issuance and sale of the Shares and the
consummation of the transactions contemplated hereby will not conflict with,
result in any breach or violation of or constitute a default under (nor
constitute any event which, with notice, lapse of time or both, would result in
any breach or violation of, constitute a default under or give the holder of
any indebtedness (or a person acting on such holders behalf) the right to
require the repurchase, redemption or repayment of all or a part of such
indebtedness under) (or result in the creation or imposition of a lien, charge
or encumbrance on any property or assets of the Company or the Subsidiaries
pursuant to) (A) the charter or bylaws or other organizational or charter
documents of the Company or the Subsidiaries (B) any indenture, mortgage,
deed of trust, bank loan or credit agreement or other evidence of indebtedness,
or any license, lease, contract or other agreement or instrument to which the
Company or the Subsidiaries is a party or by which any of them or any of their
respective properties may be bound or affected, or (C) any federal, state,
local or foreign law, regulation or rule, or (D) any rule or
regulation of any self-regulatory organization or other non-governmental regulatory
authority (including, without limitation, the rules and regulations of
NASDAQ), or (E) any decree, judgment or order applicable to the Company or
the Subsidiaries or any of their respective properties, except, with respect to
clause (B), (C), (D) or (E) for such conflicts, breaches, violations,
defaults and events as would not, individually or in the aggregate, have a
Material Adverse Effect.

(m)Independent
Accountants. Baker Tilly
Virchow Krause, LLP, which has expressed its opinion with respect to the
Companys audited financial statements (which term as used in this Agreement
includes the related notes and schedules thereto) for the fiscal year ended August 31,
2008 and supporting schedules filed with the Commission as a part of the
Registration Statement and incorporated by reference in the Prospectus
Supplement, is an independent registered public accounting firm as required by
the Act and the Exchange Act.

(n)Preparation
of the Financial Statements. The financial statements filed with the Commission
as a part of the Registration Statement or included or incorporated by
reference in the Base Prospectus or Prospectus Supplement present fairly in all
material respects the financial position of the Company and its consolidated
subsidiaries as of and at the dates thereof and the results of their operations
and cash flows for the periods specified therein, subject in the case of
anaudited statements to normal, immaterial, year-end audit adjustments. The supporting exhibits and schedules
included in the Registration Statement, if any, present fairly in all material
respects the information required to be stated therein subject to the normal
year-end adjustments which are not expected to be material in amount. Such financial statements and supporting
schedules, if any, have been prepared in conformity with generally accepted
accounting principles as applied in the United States (GAAP), as
applicable, applied on a consistent basis throughout the periods involved,
except as may be otherwise stated in the related notes thereto and except that
unaudited financial statements may not contain all footnotes required by GAAP
comply in all material respects with the Act, the Exchange Act and the
applicable rules and regulations of the Commission thereunder. No other financial statements or supporting
schedules or exhibits are required by the Act or the rules and regulations
of the Commission thereunder to be included in the Registration Statement or
the Prospectus Supplement.

(o)Incorporation
and Good Standing. Each of the
Company and each of the Companys majority-owned subsidiaries that is
considered a significant subsidiary within the meaning of Rule 1-02(w) of
Regulation S-X (collectively, the Subsidiaries)
has been duly organized and is validly existing and, as applicable, is in good
standing under the laws of the jurisdiction of incorporation or organization

5

(as applicable) with requisite power and authority
to own its properties and other assets and conduct its business as described in
the Prospectus Supplement, and is duly qualified or licensed to do business as
a foreign corporation or other entity and, as applicable, is in good standing
under the laws of each jurisdiction in which the nature of the business
conducted or property owned by it requires such qualification or license,
except where the failure to be so qualified or in good standing would not have
a Material Adverse Effect.

(p)Capitalization
and Other Capital Stock Matters. The authorized, issued and outstanding
capital stock of the Company is as set forth in the Registration Statement and
in each Prospectus Supplement (other than for issuances after the dates
thereof, if any, pursuant to employee benefit plans described in any Prospectus
Supplement or upon exercise of outstanding options or warrants described in any
Prospectus Supplement). The Shares
conform in all material respects to the description thereof contained in the
Base Prospectus and the Prospectus Supplement.
As of September 15, 2009, there were 3,759,180 shares of Common
Stock outstanding. Since September 15,
2009, the Company has not issued any securities other than (i) Common
Stock of the Company pursuant to the exercise of previously outstanding options
in connection with the Companys employee stock purchase, stock option and
stock incentive plans (the Plans), outstanding warrants and other
outstanding obligations, and (ii) options granted pursuant to the Plans in
the ordinary course of business consistent with past practice, in each case as
disclosed in the Base Prospectus and each Prospectus Supplement. All the issued and outstanding shares of the
capital stock of the Company and the Subsidiaries have been duly authorized and
validly issued, are fully paid and nonassessable and have been issued in
compliance, in all material respects, with federal and state securities laws,
as applicable. Except as set forth in
the Base Prospectus and each Prospectus Supplement, all of the outstanding
shares of capital stock of the Subsidiaries are owned, directly or indirectly,
by the Company. None of the outstanding
shares of capital stock of the Company or any Subsidiary were issued in
violation of any preemptive rights, rights of first refusal or other similar
rights to subscribe for or purchase securities.
There are no authorized or outstanding options, warrants, preemptive
rights, rights of first refusal or other rights to purchase, or equity or debt
securities convertible into or exchangeable or exercisable for, any capital
stock of the Company or any Subsidiary other than those described in the Base
Prospectus and each Prospectus Supplement.
The description of the Companys stock option, stock bonus and other
stock plans or arrangements, and the options, warrants or other rights granted
thereunder, set forth in the Base Prospectus and the Prospectus Supplement
accurately and fairly presents the information required by the Act to be shown
with respect to such plans, arrangements, options and rights. Except as set forth in the Base Prospectus or
in any Prospectus Supplement, the Company does not have any subsidiaries or own
directly or indirectly any of the capital stock or other equity or long-term
debt securities or have any equity interest in any other person.

(q)Stock
Exchange Listing. The Common
Stock is registered under the Exchange Act and is listed on the NASDAQ Global
Market (NASDAQ), and the Company has taken no action designed to, or
likely to have the effect of terminating the registration of the Common Stock
under the Exchange Act or suspending from trading the Common Stock from NASDAQ,
nor has the Company received any information suggesting that the Commission or
the Financial Industry Regulatory Authority (FINRA) is contemplating
terminating or suspending such registration or quotation.

(r)No
Transfer Taxes or Other Fees. There are no transfer taxes or other similar
fees or charges under United States law or the laws of any state or any
political subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance and sale by the
Company of the Shares.

(s)No
Price Stabilization or Manipulation. The Company has not taken and will not take,
directly or indirectly, any action designed to or that could reasonably be
expected to cause or result in

6

stabilization or manipulation of the price of the
Common Stock to facilitate the sale or resale of the Shares.

(t)FINRA Matters. The Company has filed and cleared with FINRA the Base
Prospectus included within the Registration Statement.

(u)NASDAQ Notifications. Since August 31, 2008, the Company has not
received any notice from NASDAQ regarding the delisting of the Common Stock
from NASDAQ.

(v)No FINRA Affiliations. To the Companys knowledge, there are no affiliations
or associations between (i) any member of FINRA and (ii) the Company
or any of the Companys officers, directors or 5% or greater security holders
or any beneficial owner of the Companys unregistered equity securities that
were acquired at any time on or after the 180th day immediately preceding the
date the Registration Statement was initially filed with the Commission, except
as disclosed in the Registration Statement, the Base Prospectus and the
Prospectus Supplement.

(w)No Unlawful Influence. The Company has not offered, or caused any Placement
Agent to offer, Shares to any person with the intent to influence unlawfully (A) a
customer or supplier of the Company or the Subsidiaries to alter the customers
or suppliers level or type of business with the Company or the Subsidiaries or
(B) a trade journalist or publication to write or publish favorable
information about the Company or the Subsidiaries or any of their respective
products or services.

(x)Blue
Sky. The Shares have been or will be
qualified for sale under the securities laws of such jurisdictions (United
States and foreign) as the Placement Agent and the Investors determine, or are
or will be exempt from the qualification and broker-dealer requirements of such
jurisdictions.

(y)Officers
Certificate. Any certificate
signed by an officer of the Company and delivered to the Placement Agent in
connection herewith or in connection with the Offering shall be deemed to be a
representation and warranty by the Company to the Placement Agent as to the
matters set forth therein.

(z)Intellectual Property. Except as described in the Registration Statement, the
Base Prospectus and the Prospectus Supplement, the Company and the Subsidiaries
own, or have obtained valid and enforceable licenses for, or other rights to
use, the inventions, patent applications, patents, trademarks (both registered
and unregistered), trade names, service names, copyrights, trade secrets and
other proprietary information described in the Registration Statement, the Base
Prospectus, the Prospectus Supplement as being owned or licensed by them or
which are necessary for the conduct of their respective businesses as currently
conducted or as proposed (in the Registration Statement, the Base Prospectus or
the Prospectus Supplement) to be conducted (including the commercialization of
products or services described in the Registration Statement, the Base
Prospectus or the Prospectus Supplement), except where the failure to own,
license or have such rights would not, individually or in the aggregate, have a
Material Adverse Effect (collectively, Intellectual Property). Except as described in the Registration
Statement, the Base Prospectus and the Prospectus Supplement, (i) there
are no third parties who have or, to the Companys knowledge, will be able to
establish rights to any Intellectual Property, except for, and to the extent
of, the ownership rights of the owners of the Intellectual Property which the
Registration Statement, the Base Prospectus and the Prospectus Supplement
disclose is licensed to the Company; (ii) to the Companys knowledge,
there is no infringement by third parties of any Intellectual Property; (iii) there
is no pending or, to the Companys knowledge, threatened action, suit,
proceeding or claim by others challenging the Companys rights in or to any
Intellectual Property; (iv) there is no pending or, to the Companys
knowledge, threatened action, suit, proceeding or claim by others challenging
the validity, enforceability or scope of any Intellectual Property; (v) there
is no pending or, to the Companys knowledge, threatened action, suit,
proceeding or claim by others that the Company or the Subsidiaries

7

infringes or otherwise violates, or would, upon the commercialization
of any product or service described in the Registration Statement, the Base
Prospectus, or the Prospectus Supplement, infringe or violate, any patent,
trademark, trade name, service name, copyright, trade secret or other
proprietary rights of others; (vi) the Company and the Subsidiaries have
complied with the terms of each agreement pursuant to which Intellectual
Property has been licensed to the Company or the Subsidiaries (except where the
failure to so comply would not, individually or in the aggregate, have a
Material Adverse Effect), and all such agreements are in full force and effect;
(vii) to the Companys knowledge, there is no patent or patent application
that contains claims that interfere with the issued or pending claims of any of
the Intellectual Property or that challenges the validity, enforceability or
scope of any of the Intellectual Property; (viii) to the Companys
knowledge, there is no prior art that may render any patent application within
the Intellectual Property unpatentable that has not been disclosed to the U.S.
Patent and Trademark Office; and (ix) the manufacture, use or sale of the
product candidates described in the Registration Statement, the Base
Prospectus, or the Prospectus Supplement as under development by the Company or
the Subsidiaries falls or would fall within the scope of one or more claims of
one or more patents or patent applications owned by, or exclusively licensed
to, the Company or the Subsidiaries, except with respect to each of the clauses
(i) through (ix) above, for such events as would not, individually or
in the aggregate, have a Material Adverse Effect.

(aa)Title. The Company and the Subsidiaries have good and marketable
title to all property (real and personal) described in the Registration
Statement, the Base Prospectus and the Prospectus Supplement as being owned by
any of them, free and clear of all liens, claims, security interests or other
encumbrances, except to the extent such liens, claims, security interests or
other encumbrances are disclosed in the Registration Statement, the Base
Prospectus and the Prospectus Supplement; all the property described in the
Registration Statement, the Base Prospectus or the Prospectus Supplement as
being held under lease by the Company or the Subsidiaries is held thereby under
valid, subsisting and enforceable leases.

(bb)Environmental. The Company and the Subsidiaries and their respective
properties, assets and operations are in compliance with, and the Company and
the Subsidiaries hold all permits, authorizations and approvals required under,
Environmental Laws (as defined below), except to the extent that failure to so
comply or to hold such permits, authorizations or approvals would not,
individually or in the aggregate, have a Material Adverse Effect; there are no
past, present or, to the Companys knowledge, reasonably anticipated future
events, conditions, circumstances, activities, practices, actions, omissions or
plans that could reasonably be expected to give rise to any material costs or
liabilities to the Company or the Subsidiaries under, or to interfere with or
prevent compliance by the Company or the Subsidiaries with, Environmental Laws;
except as would not, individually or in the aggregate, have a Material Adverse
Effect, neither the Company nor the Subsidiaries (i) is the subject of any
investigation, (ii) has received any notice or claim, (iii) is a
party to or affected by any pending or, to the Companys knowledge, threatened
action, suit or proceeding, (iv) is bound by any judgment, decree or order
or (v) has entered into any agreement, in each case relating to any
alleged violation of any Environmental Law or any actual or alleged release or
threatened release or cleanup at any location of any Hazardous Materials (as
defined below) (as used herein, Environmental Law means any federal,
state, local or foreign law, statute, ordinance, rule, regulation, order,
decree, judgment, injunction, permit, license, authorization or other binding
requirement, or common law, relating to health, safety or the protection,
cleanup or restoration of the environment or natural resources, including those
relating to the distribution, processing, generation, treatment, storage,
disposal, transportation, other handling or release or threatened release of
Hazardous Materials, and Hazardous Materials means any material
(including, without limitation, pollutants, contaminants, hazardous or toxic
substances or wastes) that is regulated by or may give rise to liability under
any Environmental Law).

8

(cc)Review of Environmental
Laws. The Company and the Subsidiaries periodically review
the effect of the Environmental Laws on their respective businesses, operations
and properties, in the course of which they identify and evaluate associated
costs and liabilities (including, without limitation, any capital or operating
expenditures required for cleanup, closure of properties or compliance with the
Environmental Laws or any permit, license or approval, any related constraints
on operating activities and any potential liabilities to third parties).

(dd)Labor Practice. Neither the Company nor the Subsidiaries is engaged in
any unfair labor practice; except for matters which would not, individually or
in the aggregate, have a Material Adverse Effect. Except for matters which would not,
individually or in the aggregate, have a Material Adverse Effect, (i) there
is no (A) unfair labor practice complaint pending or, to the Companys
knowledge, threatened against the Company or the Subsidiaries before the
National Labor Relations Board, and no grievance or arbitration proceeding
arising out of or under collective bargaining agreements is pending or, to the
Companys knowledge, threatened, (B) strike, labor dispute, slowdown or
stoppage pending or, to the Companys knowledge, threatened against the
Company or the Subsidiaries and (C) union representation dispute currently
existing concerning the employees of the Company or the Subsidiaries, (ii) to
the Companys knowledge, no union organizing activities are currently taking
place concerning the employees of the Company or the Subsidiaries and (iii) neither
the Company nor the Subsidiaries has violated any federal, state, local or
foreign law relating to discrimination in the hiring, promotion or pay of
employees, any applicable wage or hour laws or any provision of the Employee
Retirement Income Security Act of 1974 (ERISA) or the rules and regulations
promulgated thereunder concerning the employees of the Company or the
Subsidiaries.

(ee)Tax Returns. All tax returns required to be filed by the Company
and the Subsidiaries have been timely filed or corrected, and all taxes and
other assessments of a similar nature (whether imposed directly or through
withholding) including any interest, additions to tax or penalties applicable
thereto due or claimed to be due from such entities have been timely paid,
other than those being contested in good faith and for which adequate reserves
have been provided.

(ff)Insurance. The Company and the Subsidiaries maintain insurance
covering their respective properties, operations, personnel and businesses as
the Company reasonably deems adequate; such insurance insures against such
losses and risks to an extent which is adequate in accordance with customary
industry practice to protect the Company and the Subsidiaries and their
respective businesses; all such insurance is fully in force on the date hereof
and will be fully in force at the time of purchase; neither the Company nor the
Subsidiaries has reason to believe that it will not be able to renew any such
insurance as and when such insurance expires.

(gg)Material Contracts. Neither the Company nor the Subsidiaries has sent or
received any communication regarding termination of, or intent not to renew,
any of the contracts or agreements referred to or described in the Base
Prospectus or the Prospectus Supplement, or referred to or described in, or
filed as an exhibit to, the Registration Statement or any Incorporated
Document, and no such termination or non-renewal has been threatened by the
Company or the Subsidiaries or, to the Companys knowledge, any other party to
any such contract or agreement, except where the terminations or non-renewals
of such contracts or agreements would not, individually or in the aggregate,
have a Material Adverse Effect.

(hh)Accounting Controls. The Company and the Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i) transactions
are executed in accordance with managements general or specific authorization;
(ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting
principles and to maintain accountability for assets; (iii) access to
assets is permitted only in accordance

9

with managements general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.

(ii)Sarbanes-Oxley Controls. The Company has established and maintains and
evaluates disclosure controls and procedures (as such term is defined in Rule 13a-15
and 15d-15 under the Exchange Act) and internal control over financial
reporting (as such term is defined in Rule 13a-15 and 15d-15 under the
Exchange Act); such disclosure controls and procedures are designed to ensure
that material information relating to the Company, including its consolidated
subsidiaries, is made known to the Companys Chief Executive Officer and its
Chief Financial Officer by others within those entities, and such disclosure
controls and procedures are effective to perform the functions for which they
were established; the Companys independent auditors and the Audit Committee of
the Board of Directors of the Company have been advised of: (i) all
significant deficiencies, if any, in the design or operation of internal
controls which could adversely affect the Companys ability to record, process,
summarize and report financial data; and (ii) all fraud, if any, whether
or not material, that involves management or other employees who have a role in
the Companys internal controls; all material weaknesses, if any, in internal
controls have been identified to the Companys independent auditors; since the
date of the most recent evaluation of such disclosure controls and procedures
and internal controls, there have been no significant changes in internal
controls or in other factors that could significantly affect internal controls,
including any corrective actions with regard to significant deficiencies and
material weaknesses; all significant deficiencies and material weaknesses
(as such terms are defined in PCAOB Auditing Standard No. 2) of the
Company, if any, have been disclosed in the Registration Statement, the Base
Prospectus and the Prospectus Supplement; the principal executive officers (or
their equivalents) and principal financial officers (or their equivalents) of
the Company have made all certifications required by the Sarbanes-Oxley Act of
2002 (the Sarbanes-Oxley Act) and any related rules and regulations
promulgated by the Commission, and the statements contained in each such
certification are complete and correct; the Company, the Subsidiaries and the
Companys directors and officers are each in compliance in all material
respects with all applicable effective provisions of the Sarbanes-Oxley Act and
the rules and regulations of the Commission and NASDAQ promulgated
thereunder.

(jj)Foreign Corrupt Practices
Act. Neither the Company nor the Subsidiaries nor, to the
Companys knowledge, any employee or agent of the Company or the Subsidiaries
has made any payment of funds of the Company or the Subsidiaries or received or
retained any funds in violation of any law, rule or regulation (including,
without limitation, the Foreign Corrupt Practices Act of 1977), which payment,
receipt or retention of funds is of a character required to be disclosed in the
Registration Statement, the Base Prospectus or the Prospectus Supplement.

(kk)Dividends. Each Subsidiary is not currently prohibited, directly
or indirectly, from paying any dividends to the Company, from making any other
distribution on the respective Subsidiarys capital stock, from repaying to the
Company any loans or advances to the Subsidiaries from the Company or from
transferring any of the Subsidiaries property or assets to the Company, except
as described in the Registration Statement, the Base Prospectus and the
Prospectus Supplement.

(ll)Fees and Commissions. Except pursuant to this Agreement or as would not,
individually or in the aggregate, have a Material Adverse Effect, neither the
Company nor the Subsidiaries has incurred any liability for any finders or
brokers fee or agents commission in connection with the execution and
delivery of this Agreement or the consummation of the transactions contemplated
hereby or by the Registration Statement.

(nn)Investment Company. Neither the Company nor the Subsidiaries is, and at no
time during which a prospectus is required by the Act to be delivered (whether
physically or through compliance with

10

Rule 172 under the Act or any similar rule) in connection with any
sale of Shares will either of them be, and, after giving effect to the offering
and sale of the Shares and the application of the proceeds thereof, neither of
them will be, an investment company or an entity controlled by an investment
company, as such terms are defined in the Investment Company Act of 1940, as
amended (the Investment Company Act).

On
September 23, 2009 (the Closing Date), each of the Investors will
remit by wire transfer to an account designated by the Company an amount equal
to the aggregate purchase price for the Shares purchased by such Investor as
set forth on the signature page to the Subscription Agreement entered into
between the Company and each of the Investors.
Promptly upon receipt by the Company of the aggregate purchase price for
the Shares purchased by the Investors or at such other time on the Closing Date
as may be agreed upon by the Company and the Placement Agent, the Company shall
deliver to each Investor the Shares purchased by such Investor via the
Depository Trust Companys (DTC) Deposit or Withdrawal at Custodian
system via the DTC instructions set forth on the signature page of such
Investors Subscription Agreement, such Shares to be registered in such name or
names as designated by the Investor on the signature page to the
Subscription Agreement. The closing of
the takedown (the Closing) shall take place at the office of K&L
Gates LLP at 599 Lexington Avenue, New York, New York, 10022 (or at such other
place as shall be agreed upon by the parties hereto). All actions taken at the Closing shall be
deemed to have occurred simultaneously.

The Company further covenants and agrees with the
Placement Agent as follows:

(a)Registration
Statement Matters. During the
period beginning on the date hereof and ending at the time of the Closing (such
period being referred to herein as the Prospectus Delivery Period),
the Company agrees to advise the Placement Agent promptly after it receives
notice thereof, of the time when any amendment to the Registration Statement
has been filed or becomes effective or any supplement to the Prospectus
Supplement or any amended Prospectus Supplement has been filed and to furnish
the Placement Agent with copies thereof at the request of the Placement Agent;
to file promptly all reports and any definitive proxy or information statements
required to be filed by the Company with the Commission pursuant to Section 13(a),
14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus
Supplement; to advise the Placement Agent, promptly after it receives notices
thereof (i) of any request by the Commission to amend the Registration
Statement or to amend or supplement the Prospectus Supplement or for additional
information and (ii) of the issuance by the Commission, of any stop order
suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto or any order directed at any Incorporated
Document or any amendment or supplement thereto or any order preventing or
suspending the use of the Base Prospectus or the Prospectus Supplement or any
amendment or supplement thereto or any post-effective amendment to the
Registration Statement, of the suspension of the qualification of the Shares
for offering or sale in any jurisdiction, of the institution or threatened
institution of any proceeding for any such purpose, or of any request by the
Commission for the amending or supplementing of the Registration Statement or
Prospectus Supplement or for additional information; and, in the event of the
issuance of any stop order or of any order preventing or suspending the use of
the Base Prospectus or Prospectus Supplement or suspending any such
qualification, promptly to use its reasonable best efforts to obtain the
withdrawal of such order.

(b)Blue
Sky Compliance. The Company
will cooperate with the Placement Agent and the Investors in endeavoring to
qualify the Shares for sale or satisfy any applicable exemption(s) for
sale of the Shares under the securities laws of such jurisdictions (United
States and foreign) as the Placement

11

Agent and the Investors may
reasonably request, and will furnish such information and execute such
applications and documents as may be reasonably required for that purpose,
provided the Company shall not be required to qualify as a foreign corporation
or to file a general consent to service of process in any jurisdiction where it
is not now so qualified or required to file such a consent, and provided
further that the Company shall not be required to produce any new disclosure
document other than the Prospectus Supplement.
The Company will, from time to time, prepare and file such statements,
reports and other documents as are or may be required to continue such
qualifications in effect for so long a period as the Placement Agent may
reasonably request for distribution of the Shares.

(c)Amendments
and Supplements to the Prospectus Supplement and Other Securities Act Matters. The Company will comply with the Act and the
Exchange Act, and the rules and regulations of the Commission thereunder,
so as to permit the completion of the distribution of the Shares as
contemplated in this Agreement, the Base Prospectus and any Prospectus
Supplement. If during the Prospectus
Delivery Period, any event shall occur as a result of which, in the judgment of
the Company or in the reasonable opinion of the Placement Agent or counsel for
the Placement Agent, it becomes necessary to amend or supplement the Base
Prospectus or any Prospectus Supplement in order to make the statements
therein, in the light of the circumstances existing at the time the Prospectus
Supplement is delivered to a purchaser, not misleading, or, if it is necessary
at any time to amend or supplement the Base Prospectus or any Prospectus
Supplement to comply with any law, the Company promptly will prepare and file
with the Commission, and furnish at its own expense to the Placement Agent and
to dealers, an appropriate amendment to the Registration Statement or
supplement to the Base Prospectus or any Prospectus Supplement so that the Prospectus
Supplement as so amended or supplemented will not, in the light of the
circumstances existing at the time it is so delivered, be misleading, or so
that the Base Prospectus or any Prospectus Supplement will comply with such
law. Before amending the Registration
Statement or supplementing the Base Prospectus in connection with the Offering,
the Company will furnish the Placement Agent with a copy of such proposed
amendment or supplement, allow the Placement Agent a reasonable amount of time
to review such proposed amendment or supplement and will not file any amendment
or supplement to which the Placement Agent reasonably objects in writing,
including via electronic mail.

(d)Copies
of any Amendments and Supplements to the Prospectus Supplement. The Company agrees to furnish the Placement
Agent, without charge, during the Prospectus Delivery Period, as many copies of
the Base Prospectus and Prospectus Supplement and any amendments and
supplements thereto (including any Incorporated Documents) as the Placement
Agent may reasonably request.

(e)Use of
Proceeds. The Company
shall apply the net proceeds from the sale of the Shares sold by it in the
manner described under the caption Use of Proceeds in the Registration
Statement or the applicable Prospectus Supplement.

(f)Transfer
Agent. The Company shall engage and
maintain, at its expense, a registrar and transfer agent for the Common Stock.

(g)Earnings
Statement. As soon as
practicable and in accordance with applicable requirements under the Act, but
in any event not later than 18 months after the Closing Date of the Offering,
the Company will make generally available to its security holders and to the
Placement Agent an earnings statement, covering a period of at least 12
consecutive months beginning after the Closing Date, that satisfies the
provisions of Section 11(a) and Rule 158 under the Act.

(h)Periodic
Reporting Obligations.
During the Prospectus Delivery Period, the Company shall duly file, on a
timely basis, with the Commission all reports and documents required to be
filed under the Exchange Act within the time periods and in the manner required
by the Exchange Act.

12

(i)Additional
Documents. The Company
will enter into any subscription, purchase or other customary agreements as the
Placement Agent or the Investors deem necessary or appropriate to consummate
the Offering, all of which will be in form and substance reasonably acceptable
to the Placement Agent, the Investors and the Company. The Company agrees that the Placement Agent
may rely upon, and is a third party beneficiary of, the representation and
warranties, and applicable covenants, set forth in any such purchase,
subscription or other agreement with Investors in the Offering.

(j)Company Lock-up.
The Company will not offer or sell any securities of the Company that
are of the same or a similar class as the Shares for a period of 90 days after
the Closing Date, other than: (a) offers
or sales of securities under an employee benefit plan as defined in Rule 405
under the Act; (b) offers or sales of securities in connection with
options, warrants, or convertible securities outstanding as of the Closing
Date; (c) securities issued pursuant to stock splits, stock dividends or
distributions, recapitalizations and similar events affecting the Common Stock;
(d) shares of Common Stock or warrants to vendors or strategic partners of
the Company; or (e) securities issued pursuant to mergers, acquisitions or
strategic transactions.

Section 5.Conditions
of the Obligations of the Placement Agent.

The obligations of the
Placement Agent hereunder shall be subject to the accuracy of the
representations and warranties on the part of the Company set forth in Section 2
as of the date hereof and as of the Closing Date of the Offering as though then
made, to the timely performance by the Company of its covenants and other
obligations hereunder on and as of such dates, and to each of the following
additional conditions:

(a)Compliance
with Registration Requirements; No Stop Order; No Objection from FINRA. Each Prospectus Supplement shall have been
duly filed with the Commission in accordance with Rule 424(b); no stop
order suspending the effectiveness of the Registration Statement or any part thereof
shall have been issued and no proceeding for that purpose shall have been
initiated or threatened by the Commission; no order preventing or suspending
the use of any Prospectus Supplement shall have been issued and no proceeding
for that purpose shall have been initiated or threatened by the Commission; no
order having the effect of ceasing or suspending the distribution of the Shares
or any other securities of the Company shall have been issued by any securities
commission, securities regulatory authority or stock exchange and no
proceedings for that purpose shall have been instituted or shall be pending or,
to the knowledge of the Company, contemplated by any securities commission,
securities regulatory authority or stock exchange; all requests for additional
information on the part of the Commission shall have been complied with; and
FINRA shall have raised no objection to the fairness and reasonableness of the
placement agency terms and arrangements.

(b)Corporate
Proceedings. All
corporate proceedings and other legal matters in connection with this
Agreement, the Registration Statement and each Prospectus Supplement, and the
registration, authorization, issue, sale and delivery of the Shares, shall have
been reasonably satisfactory in all material respects to the Placement Agents
counsel, and such counsel shall have been furnished with such papers and
information as they may reasonably have requested to enable them to pass upon
the matters referred to in this Section 5.

(c)No
Material Adverse Change.
Subsequent to the execution and delivery of this Agreement and prior to
the Closing Date, there shall not have occurred any Material Adverse Change or
Material Adverse Effect, which, in the reasonable judgment of the Placement
Agent, makes it impracticable or inadvisable to proceed with the Offering on
the terms and in the manner contemplated by the applicable Prospectus
Supplement.

13

(d)Opinion
of Counsel for the Company. The Placement Agent shall have received on
the Closing Date of the Offering, and the Company shall cause to be delivered
to the Placement Agent an opinion of legal counsel to the Company in
substantially the form as agreed to by the parties hereof, dated the Closing
Date, addressed to the Placement Agent.

(e)Accountants
Comfort Letter. The
Placement Agent shall have received on the Closing Date and the Company shall
cause to be delivered to the Placement Agent a letter from Baker Tilly Virchow
Krause, LLP (or the Companys current independent registered public accounting
firm), addressed to the Placement Agent, dated as of the Closing Date, in
substantially the form as agreed to by the parties hereof. The letter shall confirm that Baker Tilly
Virchow Krause, LLP is an independent registered accounting firm with respect
to the Company and any Subsidiary within the meaning of the Act and the rules and
regulations thereunder and the rules and regulations of the Public Company
Accounting Oversight Board and shall state the conclusions and findings of such
firm, of the type ordinarily included in accountants comfort letters to
underwriters, with respect to the financial statements and certain financial
information contained or incorporated by reference in the Registration
Statement, the Base Prospectus and the Prospectus Supplement.

(f)Officers
Certificate. The
Placement Agent shall have received on the Closing Date a certificate of the
Company, in a form reasonably satisfactory to the Placement Agent, dated as of
the Closing Date signed by the Chief Executive Officer and Chief Financial
Officer of the Company, to the effect that:

(i)The
representations and warranties of the Company in this Agreement are true and
correct, as if made on and as of the Closing Date, and the Company has complied
in all material respects with all the agreements and satisfied in all material
respects all the conditions on its part to be performed or satisfied at or
prior to the Closing Date;

(ii)No stop order
suspending the effectiveness of the Registration Statement or the use of the
Base Prospectus or the Prospectus Supplement has been issued and no proceedings
for that purpose have been instituted or are pending or, to the Companys
knowledge, threatened under the Act; no order having the effect of ceasing or
suspending the distribution of the Shares or any other securities of the
Company has been issued by any securities commission, securities regulatory
authority or stock exchange in the United States and no proceedings for that
purpose have been instituted or are pending or, to the knowledge of the
Company, contemplated by any securities commission, securities regulatory
authority or stock exchange in the United States;

(iii)When the
Registration Statement became effective and at all times subsequent thereto up
to the delivery of such certificate, the Registration Statement, the Base
Prospectus and each Prospectus Supplement and any amendments or supplements
thereto, and Incorporated Documents, when such documents became effective or
were filed with the Commission, contained all material information required to
be included therein by the Act and the Exchange Act and the applicable rules and
regulations of the Commission thereunder, as the case may be, and in all
material respects conformed to the requirements of the Act and the Exchange Act
and the applicable rules and regulations of the Commission thereunder, as
the case may be, and the Registration Statement and the Base Prospectus and the
Prospectus Supplement, and any amendments or supplements thereto, did not and
do not include any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (provided, however, that the preceding representations and
warranties contained in this paragraph (iii) shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by the Placement Agent
expressly for use

14

therein)
and, since the effective date of the Registration Statement, there has occurred
no event required by the Act and the rules and regulations of the
Commission thereunder to be set forth in an amended or supplemented Prospectus
Supplement which has not been so set forth;

(iv)Subsequent to
the respective dates as of which information is given in the Registration
Statement, the Base Prospectus and each Prospectus Supplement, there has not
been: (a) any Material Adverse
Change; (b) any transaction that is material to the Company and the
Subsidiaries taken as a whole, except transactions entered into in the ordinary
course of business; (c) any obligation, direct or contingent, that is
material to the Company and the Subsidiaries taken as a whole, incurred by the
Company or any Subsidiary, except obligations incurred in the ordinary course
of business; (d) any material change in the capital stock (except changes
thereto resulting from the exercise of outstanding stock options or warrants)
or outstanding indebtedness of the Company or any Subsidiary; (e) any
dividend or distribution of any kind declared, paid or made on the capital
stock of the Company; or (f) any loss or damage (whether or not insured)
to the property of the Company or the Subsidiaries which has been sustained or
will have been sustained which has a Material Adverse Effect; and

(v)The Company has
been subject to continuous disclosure requirements of the Exchange Act for a
period of at least 12 calendar months immediately preceding the filing of the
Registration Statement, has timely filed all reports required of it to be filed
under the Exchange Act during the past 12 calendar months and the portion of
the month in which the Registration Statement was filed, and as of the date of
the Base Prospectus and each Prospectus Supplement is currently in compliance
with such obligations.

(g)Listing. The Common Stock (including the Shares) is
registered under the Exchange Act and is or will as of the Closing Date be
listed on NASDAQ, and the Company has taken no action designed to, or likely to
have the effect of terminating the registration of the Shares under the
Exchange Act or suspending from trading the Shares on NASDAQ, nor has the
Company received any written information suggesting that the Commission or
FINRA is contemplated terminating such registration or quotation.

(i)Lock-Up Agreements.
Each of the Companys officers and directors and Inter Alia Holding
Company shall execute and deliver a Lock-up Agreement, in a form
reasonably satisfactory to the Placement Agent, restricting the transfer or
other disposition of any shares of Common Stock of the Company or securities
convertible into, exchangeable, or exercisable for Common Stock of the Company
held of record or beneficially by such officers and directors for a period of
ninety (90) days after the Closing Date, subject to the exemptions stated
therein.

If any condition specified in this Section 5 is
not satisfied in all material respects when and as required to be satisfied,
this Agreement may be terminated by the Placement Agent by notice to the
Company signed by the Placement Agent at any time on or prior to the Closing
Date, which termination shall be without liability on the part of any party to
any other party, except that Section 6 (Payment of Expenses), Section 7
(Reimbursement of Placement Agents Expenses), Section 8 (Indemnification
and Contribution) and Section 10 (Representations and Indemnities to
Survive Delivery) shall at all times be effective and shall survive such
termination.

The Company agrees to pay all costs, fees and
expenses incurred in connection with the performance of its obligations
hereunder and in connection with the transactions contemplated hereby,
including without limitation: (i) all
expenses incident to the issuance, delivery and qualification of the Shares
(including all printing and engraving costs); (ii) all fees and expenses
of the registrar and transfer agent of the Common Stock; (iii) all
necessary issue, transfer and other stamp taxes in connection with the issuance
and sale of the Shares; (iv) all fees and expenses of the Companys
counsel, independent public or certified public accountants and other advisors
to the Company; (v) all costs and expenses incurred in connection with the
preparation, printing, filing, shipping and distribution of the Registration
Statement (including financial statements, exhibits, schedules, consents and
certificates of experts), the Base Prospectus and each Prospectus Supplement,
and all amendments and supplements thereto, and this Agreement; (vi) all
filing fees and expenses incurred by the Placement Agent in connection with
qualifying or registering (or verifying or obtaining exemptions from the
qualification or registration of) all or any part of the Shares for offer and
sale under the state securities or blue sky laws, and, if requested by the
Placement Agent, preparing and printing a Blue Sky Survey, an International
Blue Sky Survey or other memorandum, and any supplements thereto, advising the
Placement Agent of such qualifications, registrations and exemptions; (vii) all
reasonable and documented attorneys fees and expenses incurred by the
Placement Agent in connection with the Offering up to a maximum of $65,000; (viii) the
filing fees incurred by the Placement Agent in connection with the approval by
FINRA of the Placement Agents participation in the offering and distribution
of the Shares; (ix) the fees and expenses associated with including the
Shares for listing on NASDAQ; (x) all costs and expenses incident to the
travel and accommodation of the Companys employees on the roadshow, if any;
and (xi) all other fees, costs and expenses referred to in Part II of the
Registration Statement.

Whether or not this Agreement is terminated, and
whether or not the sale to the Investors of the Shares on any Closing Date is
consummated, the Company agrees to reimburse the Placement Agent, upon demand,
for all reasonable and documented out-of-pocket expenses that shall have been
reasonably incurred by the Placement Agent in connection with the Offering,
including, but not limited to, legal and filing fees and other disbursements of
counsel for the Placement Agent, printing expenses, travel and accommodation
expenses, postage, facsimile and telephone charges, up to a maximum of $65,000.

Section 8.Indemnification
and Contribution.

(a)Indemnification
of the Placement Agent. The
Company agrees to indemnify and hold harmless the Placement Agent, its
officers, directors, members, employees and agents, and each person, if any,
who controls the Placement Agent within the meaning of the Act and the Exchange
Act (collectively, the Placement Agent Indemnified Parties) against
any action, loss, claim, damage, costs, liability or expense (collectively, Loss),
joint or several, as incurred, to which such Placement Agent Indemnified
Parties may become subject, under the Act, the Exchange Act, or other federal
or state statutory law or regulation, or at common law or otherwise (including
in settlement of any litigation, if such settlement is effected with the
written consent of the Company, which consent shall not be unreasonably
withheld), insofar as such loss, claim, damage, liability or expense (or
actions in respect thereof as contemplated below) arises out of or is based: (i) upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, or
any amendment thereto, or the omission or alleged omission therefrom of a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading; or (ii) upon any untrue statement or alleged untrue statement
of a material fact contained in the Base Prospectus, or each Prospectus
Supplement (or any amendment or supplement thereto), or the omission or alleged
omission

16

therefrom of a material fact necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading; or (iii) in whole or in part upon any
inaccuracy in the representations and warranties of the Company contained in
this Agreement or the Subscription Agreement; or (iv) in whole or in part
upon any failure of the Company to perform its obligations hereunder or under
law; or (v) upon a breach by the Company of this Agreement; (vi) any
act or failure to act or any alleged act or failure to act by the Placement
Agent in connection with, or relating in any manner to, the Shares or the
Offering contemplated hereby, and which is included as part of or referred to
in any Loss arising out of or based upon any matter covered by clause (i),
(ii), (iii), (iv), or (v) above, provided that the Company shall not be
liable under clause (iv), (v) and (vi) to the extent that a court of
competent jurisdiction shall have determined by a final judgment that such Loss
resulted directly from any such acts or failures to act undertaken or omitted
to be taken by such Placement Agent through its gross negligence or willful
misconduct; and to reimburse such Placement Agent Indemnified Party for any and
all expenses (including the reasonable fees and disbursements of one counsel
chosen by the Placement Agent) as such expenses are reasonably incurred by such
Placement Agent Indemnified Party in connection with investigating, defending,
settling, compromising or paying any such Loss; provided, however, that the
foregoing indemnity agreement shall not apply to any Loss to the extent, but
only to the extent, arising out of or based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with written information furnished to the Company by the
Placement Agent expressly for use in the Registration Statement, the Base
Prospectus or each Prospectus Supplement (or any amendment or supplement
thereto).

(b)Indemnification
of the Company, its Directors and Officers. The Placement Agent agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers who
signed the Registration Statement and each person, if any, who controls the
Company within the meaning of the Act or the Exchange Act, against any Loss, as
incurred, to which the Company, or any such director, officer or controlling person
may become subject, under the Act, the Exchange Act, or other federal, state
statutory law or regulation, or at common law or otherwise (including in
settlement of any litigation, if such settlement is effected with the written
consent of such Placement Agent; which consent shall not be unreasonably
withheld), insofar as such loss, claim, damage, liability or expense (or
actions in respect thereof as contemplated below) arises out of or is based
upon any untrue or alleged untrue statement of a material fact contained in any
Prospectus Supplement (or any amendment or supplement thereto), or arises out
of or is based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or alleged
omission was made in such Prospectus Supplement (or any amendment or supplement
thereto), in reliance upon and in conformity with written information furnished
to the Company by such Placement Agent expressly for use therein and to
reimburse the Company, or any such director, officer or controlling person for
any legal and other expense reasonably incurred by the Company, or any such
director, officer or controlling person in connection with investigating,
defending, settling, compromising or paying any such Loss.

(c)Information
Provided by the Placement Agent. The Company and each person, if any, who
controls the Company within the meaning of the Act or the Exchange Act, hereby
acknowledges that the only information that the Placement Agent will furnish to
the Company expressly for use in any Prospectus Supplement (or any amendment or
supplement thereto) are the statements regarding the Placement Agent set forth
under the caption Plan of Distribution in the Prospectus Supplement.

(d)Notifications
and Other Indemnification Procedures. Promptly after receipt by an indemnified
party under this Section 8 of notice of the commencement of any action,
such indemnified party will, if a claim in respect thereof is to be made
against an indemnifying party under this Section 8, notify the
indemnifying party in writing of the commencement thereof, but the omission so
to notify the

17

indemnifying party will not relieve it from any
liability, which it may have to any indemnified party for contribution to the
extent it is not prejudiced as a proximate result of such failure. In case any such action is brought against
any indemnified party and such indemnified party seeks or intends to seek
indemnity from an indemnifying party, the indemnifying party will be entitled
to participate in, and, to the extent that it shall elect, jointly with all
other indemnifying parties similarly notified, by written notice delivered to
the indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably satisfactory
to such indemnified party; provided, however, if the defendants in any such
action include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that a conflict may arise
between the positions of the indemnifying party and the indemnified party in
conducting the defense of any such action or that there may be legal defenses
available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party, the indemnified party
or parties shall have the right to select separate counsel to assume such legal
defenses and to otherwise participate in the defense of such action on behalf
of such indemnified party or parties.
Upon receipt of notice from the indemnifying party to such indemnified
party of such indemnifying partys election so to assume the defense of such
action and approval by the indemnified party of counsel, the indemnifying party
will not be liable to such indemnified party under this Section 8 for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof unless:
(i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the next preceding sentence (it being
understood, however, that the indemnifying party shall not be liable for the
expenses of more than one separate counsel (together with local counsel),
approved by the indemnifying party), representing the indemnified parties who
are parties to such action); (ii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of the
action; or (iii) the indemnifying party has authorized the employment of
counsel for the indemnified party at the expense of the indemnifying party, in
each of which cases the fees and expenses of counsel shall be at the expense of
the indemnifying party.

(e)Settlements. The indemnifying party under this Section 8
shall not be liable for any settlement of any proceeding effected without its
written consent, which consent shall not be unreasonably withheld, but if
settled with such consent or if there be a final non-appealable judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified party
against any Loss by reason of such settlement or judgment. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement, compromise
or consent to the entry of judgment in any pending or threatened action, suit
or proceeding in respect of which any indemnified party is or could have been a
party and indemnity was or could have been sought hereunder by such indemnified
party, unless such settlement, compromise or consent includes: (i) an unconditional release of such
indemnified party from all liability on claims that are the subject matter of
such action, suit or proceeding; and (ii) does not include a statement as
to or an admission of fault, culpability or a failure to act by or on behalf of
any indemnified party.

(f)Contribution. If the indemnification provided for in this Section 8
is unavailable to or insufficient to hold harmless an indemnified party under Section 8(a) or
(b) above in respect of any losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) then each indemnifying party shall
contribute to the aggregate amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect the relative benefits received by
such party on the one hand and the Placement Agent on the other from the
offering of the Shares. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law then each indemnifying party shall contribute to such amount
paid or payable by such indemnified party in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault of such
indemnifying party on the one hand and the Placement Agent on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof),
as well as any

18

other relevant equitable considerations. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company, its directors,
its officers or its controlling persons on the one hand or the Placement Agent
on the other and the parties relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.

The Company and Placement Agent agree that it would
not be just and equitable if contributions pursuant to this Section 8(f) were
determined by pro rata allocation or by any other method of allocation which
does not take account of the equitable considerations referred to above in this
Section 8(f). The amount paid or
payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to above in
this Section 8(f) shall be deemed to include any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the provisions of this Section 8(f): (i) the Placement Agent shall not be
required to contribute any amount in excess of the amount of the placement
agent fees actually received by such Placement Agent pursuant to this
Agreement; and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.

(g)Contribution
Procedure. Within
fifteen days after receipt by any party to this Agreement (or its
representative) of notice of the commencement of any action, suit, or
proceeding, such party will, if a claim for contribution in respect thereof is
to be made against another party (Contributing Party), notify the
Contributing Party of the commencement thereof, but the omission to so notify
the Contributing Party will not relieve it from any liability which it may have
to any other party other than for contribution hereunder. In case any action, suit, or proceeding is
brought against any party, and such party notifies a Contributing Party or its
representative of the commencement thereof within the aforesaid fifteen days,
the Contributing Party will be entitled to participate therein with the
notifying party and any other Contributing Party similarly notified. Any such Contributing Party shall not be
liable to any party seeking contribution on account of any settlement of any
Loss effected by such party seeking contribution without the written consent of
such Contributing Party. The
contribution provisions contained in this Section are intended to
supersede, to the extent permitted by law, any right to contribution under the
Act, the Exchange Act or otherwise available.
The Placement Agents obligations to contribute pursuant to this Section 8(g) are
several and not joint.

(h)Timing
of Any Payments of Indemnification. Any losses, claims, damages, liabilities or
expenses for which an indemnified party is entitled to indemnification or
contribution under this Section 8 shall be paid by the indemnifying party
to the indemnified party as such losses, claims, damages, liabilities or
expenses are incurred, but in all cases, no later than forty-five (45) days of
invoice to the indemnifying party.

(i)Acknowledgements
of Parties. The parties
to this Agreement hereby acknowledge that they are sophisticated business
persons who were represented by counsel during the negotiations regarding the
provisions hereof including, without limitation, the provisions of this Section 8,
and are fully informed regarding said provisions. They further acknowledge that the provisions
of this Section 8 fairly allocate the risks in light of the ability of the
parties to investigate the Company and its business in order to assure that
adequate disclosure is made in the Registration Statement or each Prospectus
Supplement as required by the Act and the Exchange Act.

(a)The Placement
Agent has not distributed and will not distribute any offering material in
connection with the Offering and sale of the Shares other than the Base
Prospectus and each Prospectus Supplement or the Registration Statement and
copies of the documents incorporated by reference therein and the Subscription
Agreement in the form approved by the Company.

(b)The Placement
Agent will not use or refer to any materials on the Companys website in
connection with the offering and sale of the Shares.

(c)The Placement
Agent agrees not to use any confidential information concerning the Company
provided to the Placement Agent by the Company for any purposes other than
those contemplated under this Agreement.

The respective indemnities, agreements,
representations, warranties and other statements of the Company or any person
controlling the Company, including its officers and directors, and of the
Placement Agent set forth in or made pursuant to this Agreement, including, but
not limited to the indemnity and contribution agreements contained in Section 8,
will remain in full force and effect, regardless of (i) any investigation
made by or on behalf of any Placement Agent or any person controlling such
Placement Agent, the Company, its directors or officers or any persons controlling
the Company; (ii) delivery and acceptance of any Shares and payment
therefor hereunder; and (iii) any termination of this Agreement until the
earlier of the expiration of any applicable statute of limitations and the
seventh anniversary of the Closing Date.
A successor to any Placement Agent, or to the Company, its directors or
officers or any person controlling the Company, shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in Section 8.

This Agreement will inure to the benefit of and be
binding upon the parties hereto, and to the benefit of the employees, officers
and directors and controlling persons referred to in Section 8, and to
their respective successors, and personal representatives, and no other person
will have any right or obligation hereunder.
Neither the Company nor the Placement Agent shall be entitled to assign
their rights, or delegate their responsibilities, hereunder without the prior
written consent of the other party hereto.

The
invalidity or unenforceability of any section, paragraph or provision of this
Agreement shall not affect the validity or enforceability of any other Section,
paragraph or provision hereof. If any
Section, paragraph or provision of this Agreement is for any reason determined
to be invalid or unenforceable, there shall be deemed to be made such minor
changes (and only such minor changes) as are necessary to make it valid and
enforceable.

(a)Governing
Law. This agreement shall be
governed by and construed in accordance with the internal laws of the State of
New York applicable to agreements made and to be performed in such state
without giving effect to the principles of conflicts of law of such State.

(b)Consent
to Jurisdiction. Any legal
suit, action or proceeding arising out of or based upon this Agreement or the
transactions contemplated hereby (Related Proceedings) may be
instituted in the federal courts of the United States of America located in New
York County, New York, or the courts of the State of New York in each case
located in New York County (collectively, the Specified Courts), and
each party irrevocably submits to the exclusive jurisdiction (except for
proceedings instituted in regard to the enforcement of a judgment of any such
court (a Related Judgment), as to which such jurisdiction is
non-exclusive) of such courts in any such suit, action or proceeding. Service of any process, summons, notice or
document by mail to such partys address set forth above shall be effective

21

service of process for any suit, action or other
proceeding brought in any such court.
The parties irrevocably and unconditionally waive any objection to the
laying of venue of any suit, action or other proceeding in the Specified Courts
and irrevocably and unconditionally waive and agree not to plead or claim in
any such court that any such suit, action or other proceeding brought in any
such court has been brought in an inconvenient forum.

This Agreement constitutes the entire agreement of
the parties to this Agreement and supersedes all prior written or oral and all
contemporaneous oral agreements, understandings and negotiations with respect
to the subject matter hereof. This
Agreement may be executed in two or more counterparts (including via facsimile
or pdf), each one of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument. This Agreement may not be amended or modified
unless in writing by all of the parties hereto, and no condition herein
(express or implied) may be waived unless waived in writing by each party whom
the condition is meant to benefit. Section headings
herein are for the convenience of the parties only and shall not affect the
construction or interpretation of this Agreement.

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[Signature Page Follows]

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If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the Company the
enclosed copies hereof, whereupon this instrument, along with all counterparts
hereof, shall become a binding agreement in accordance with its terms.